End to fuel subsidy: FG appeals to Saudi Arabia to build refineries in Nigeria

The Federal Government of Nigeria is appealing to the Saudi Arabia to build refineries in Nigeria. This has been a major problem of the Nigerian government which has been spending trillions of naira in paying petrol subsidy on petroleum products which crude oil is derived from Nigeria but refined overseas.  Unfortunately, Nigeria has four non-functional refineries and the federal government has been unable to build new ones to replace them. Hence, the government depends heavily on processing crude oil into petrol overseas and shipping back to Nigeria at higher cost for consumption.

The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, at Bloomberg Daybreak: Americas’ on the sidelines of the Financial Sector Conference in Riyadh, Saudi Arabia, acknowledged that said the Federal Government was looking at the possibilities of having the Kingdom of Saudi Arabia build a refinery in Nigeria.

The minister was said to have noted the four refineries in the country have a combined installed capacity of 445,000 barrels per day but have continued to operate far below the installed capacity for many years.

The minister further said that the Federal Government of Nigeria is seeking a straight trade deals and arranges with Saudi Arabia to bring in products into the country.

Aramco was said to be expanding the downstream operations in refining and petrochemicals production towards becoming world’s largest integrated energy firm.